An emergency warning was in place for Tarago, 70 kilometres from Canberra, as the blaze moved towards Mount Fairy on Tuesday night. At least one home was reportedly destroyed in the area overnight, with properties and cars also damaged, and more are under threat even despite overnight rainfall which eased the fire danger.

Things will not get easier on Wednesday however, with the Canberra area set to hit 37 degrees with dry and windy conditions forecast.

The fire danger is ranked at "extreme" in NSW's southern ranges, including Goulburn and Queanbeyan, with most of the rest of the state in "severe" or "very high" fire danger warnings. The NSW rural fire service declared total fire bans across five areas in the state on Wednesday morning -- the southern slopes, southern ranges, Illawarra and Shoalhaven, the central ranges and Greater Sydney -- before later adding the Greater Hunter to the list.